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California Water Plan Update 2018: Managing water resources for sustainability

The draft of the update, just under 50 pages, is a much more trimmed down version of its predecessors and includes cost estimates and funding options; public comment period through January 21st

Kamyar Guivetchi is with the California Department of Water Resources, Statewide Integrated Water Management Branch where one of the main activities is updating the California Water Plan every 5 years. At the December meeting of the California Water Commission, Mr. Guivetchi gave an overview of the draft of the most recent update of the Plan which was released for comment on December 20.

Mr. Guivetchi noted that for the last 18 years, the Department has taken a collaborative approach to updating the plan; in addition to the 30-member State Agency Steering Committee, there is also a 50-member Stakeholder Policy Advisory Committee as well as a 30-member Tribal Advisory Committee. They have also held annual plenary meetings. The Water Plan update has been informed by and includes a compilation of about 45 companion state plans.

“The underpinning theme of this update is managing water resources for sustainability,” he said. “The focus and features of this update, like all strategic plans, has the California Water Today discussion where we lay out what the challenges are as well as the accomplishments over the past 5-6 years and what are the drivers of change going forward. We also include more discussion on sustainability, including what we call a ‘sustainability outlook’ as a way of really being able to express and have a common understanding of what we mean by sustainability when it comes to water resources.”

The California Water Plan update has about 20 actionable recommendations and is under 50 pages long, whereas the prior plan had about 350 recommendations and about 3500 pages spread across numerous volumes. “We took a prioritization approach, because over the last 18 years, we have built a really substantial body of knowledge and rather than just repeat and reproduce that, we thought it would be more effective to really prioritize the work that we’ve done and what would be really helpful in moving forward over the next 5-10 years,” he said. “Unlike the previous Water Plans, we started penciling cost estimates for what it would take to implement the recommendations, as well as some funding options of where the revenue could come from to actually do that work.”

The California Water Plan Update has four chapters: Chapter 1 is a conditions assessment; Chapter 2 is a deeper dive in the continuing challenges that we face in the state; Chapter 3 has specific recommendations for sustainability; and Chapter 4 is the investment chapter. There are 15 supporting documents and 45 companion state plans that are part of the underpinning of the water plan update.

In the first chapter, the conditions assessment, they wanted to underscore that in a Mediterranean climate, dealing with extreme climate conditions and weather is not unusual or unique in and of itself; however, in the last decade or two, we are observing those extremes becoming more frequent and deeper, he said.

“We’ve lived through what is considered the most consequential five year drought, followed by the second wettest year on record, and we’re now in an average or below average climate condition,” he said. “This is also having effects on our snowpack dynamics. A lot of our infrastructure in the state that’s been built over the last 100-150 years has really been predicated on the snowpack and the snowmelt dynamics. That is changing underneath our feet. And so we really have to be much more aggressive and attentive to modernizing our infrastructure as we move forward.”

The first chapter has a discussion about the drought and what extreme events mean for California water management, and like previous water plans, the data for water use and water supplies for the years 2010-2015 are included, both regional data and aggregated statewide. The data set now includes the drought period, he noted.

The first chapter discusses the accomplishments that the state government along with regional and local partners has made. Prop 1 and Prop 68 have been an important infusion of state funding to help realize many of those accomplishments. The first chapter also lays out in detail the investments made by the federal government, state government and local entities.

The chart on the slide shows that over the last 10-15 years, there has been significant investment in water. He noted that in 2015, the total spent on water projects was $40 billion, and of that, $30 billion was at the local level; $4 billion at the state level, partly because of the infusion of the proposition funding. He pointed out that the federal investments have been pretty low and pretty flat for many years.

Mr. Guivetchi pointed out that on average, the state has been spending about $2 billion a year on all aspects of integrated water management, but only 2% of the general fund has been going to water. “That is a statement of how we have been valuing water, and I would offer that to really move toward a more sustainable state of water management, we have to really convince the public that we’re going to have to have better investments,” he said. “We also have to be in a position to demonstrate the return on those investments.”

Mr. Guivetchi also pointed out that most of the investment – about 80% – is at the local and regional level with about three-quarters of those investments going towards ongoing planning and operation and maintenance. “That’s one area that we’ve really been lax in funding as a state, and that’s why we have aging infrastructure that really is not up to snuff for today, much less the challenges that climate change is going to confront us with,” he said. “We’ve done a back of the envelope estimate with our local partners on what is kind of the unmet investment demand, and on the low end, it’s around $350 billion to just be able to modernize our water resource infrastructure.”

In addition to highlighting the critical challenges to sustainability, there are some systemic and institutional challenges that make resolving those critical challenges difficult, he said. “One is that we have a very decentralized way of making decisions about water,” he said. “Over 2300 entities are part and parcel of the entire managing the water cycle. Each one has its own planning and decision making process and those have not been as coordinated as we think they need to be, and part of that also leads to inconsistent and sometimes conflicting regulation and permitting processes. Project proponents find it very time consuming and difficult to get the necessary permits, especially if they want to do multi-benefit cross-sector types of water management projects.”

If we’re going to do multi-benefit cross-sector planning, we’ll need better data and we’ll need to integrate data the various water sector silos into a body of knowledge that can be used to assess and decide what multi-benefit projects will pencil out, he said. He also noted that the funding cannot depend on the boom and bust of the general obligation bond process; a more stable funding source is needed. And there must be accountability: we must measure, analyze, and report the performance or lack thereof of our activities, he said.

In moving forward towards a more sustainable way of managing, Mr. Guivetchi said that we need to have shared intent and outcomes from the outset, and the goals that are set need to have a longer time horizon than in the past. We need to continue to work on the alignment and integration amongst our water management sectors, making sure our investments are consistent with what Californians value. We need to be tracking outcomes and using adaptive management, and recognize sustainability is not a destination, it’s a journey, he said.

The 2018 California Water Plan update has six goals for sustainability. The first goal is to improve integrated watershed management. “This is really to provide more support for the regional water management groups, the regional flood management groups, and the groundwater sustainability agencies that have been coming together,” Mr. Guivetchi said. “We’ve really got to empower and support their activities as we move forward.”

The second and third goals go hand in hand, he said. The second is strengthening our infrastructure resiliency as well as how that infrastructure is operated, which requires investment in both capital and operation and maintenance. The third goal is that as we’re working on our gray infrastructure, we have to restore the functions of our critical ecosystems and consider them as natural capital and for the ecosystem services, they can provide, he said.

“But we have to recognize that in a state, the fifth largest economy in the world, we still have hundreds of thousands of people that do not have safe drinking water and sanitation,” he said. “We really have to focus on this as a state and help empower tribes and vulnerable and disadvantaged communities in our water planning and management through technical and financial assistance.”

The fifth goal is that state agencies and local agencies need to work to align our activities and make sure that the regulations that underpin them are more consistent than they are now, he continued. And finally, we have to make sure that we can build an data and analytical infrastructure that is up to the task at hand, he said.

Mr. Guivetchi then presented a diagram which he likened to a flower, noting that the outer petals are the major water management sectors, and historically, most of the activities in each sector have been toward the outer parts of those petals where there is little and in some cases no overlap.

“For the last 100 to 150 years, the focus has been on specialization and optimization, but what we are not realizing is that there are unintended consequences that that can actually cause problems for other sectors,” he said. “As we move toward the center of this flower, you’ll see the overlap increases, and that’s where we really need to focus our future water planning and water management. I like to call it more co-management of our water management sectors as we do multi-benefit projects. This to me is really at the core of what we mean by integrated watershed management, where we bring multiple sectors together with multiple disciplines on multi-benefit projects and by doing so, knitting together multiple pots of money from the various sectors.”

The California Water Plan update estimates that implementing the 20 or so recommendations over the next 50 years would cost the state $90 billion. Of that $90 billion, 86% or almost $78 billion is state cost share of funding that needs to go to regional and local activities and projects; about $10 billion or 10% is for state infrastructure and ecosystem project; and $2.7 billion or less than 3% are for those underlying support activities that can help overcome the systemic and institutional problems.

“Unfortunately, as the bar chart shows, those are the reddish parts of the bar way at the bottom,” he said. “So as we make these investments, we’re going to have to make sure that the public understand its importance and demonstrate that they are leading to better public health and safety, a better economy, a more resilient and vibrant ecosystem, and what are called ‘enriching experiences.’”

The way to do that is to have a more rigorous and determined process for planning, tracking, adapting, and acting, and the cycle needs to keep moving forward, he said. “We have to give ourselves permission to make mistakes and adapt, because we don’t have perfect foresight.”

The 2018 California Water Plan update offers the ‘sustainability outlook tool’ as a way to help with tracking outcomes. The sustainability outlook tool has four values, a dozen outcomes, and three dozen metrics or indicators which are all laid out in one of the supporting documents of the update.

“For instance, one of the values of the public is public health and safety, an outcome from that value is an adequate water supply for domestic needs, sanitation, and fire suppression,” Mr. Guivetchi said. “An indicator or a metric that could be used is what percentage of the population don’t meet the necessary water quality standards for drinking water.”

The sustainability outlook tool was also tested in pilot studies conducted in the Santa Ana watershed and the Russian River watershed.

Mr. Guivetchi wrapped up his presentation by noting that the California Water Plan is required by law, but the water code states that the Plan has no mandates and no automatic appropriation of funds, so the legislature and the Governor need to take further action to actually implement the water plan. The Plan offers an investment strategy for the first time, along with some funding scenarios for how those revenues could be generated.

Commissioner Catherine Keig notes that 2300 entities managing water is ‘ridiculous.’ “It’s very difficult to have any kind of efficiency if you’re dealing with that many entities. Do you have any vision for what might be done about that?”

“In fact, the state has recognized this as a challenge for a number of years, and it was the premise of the Integrated Regional Water Management grant program,” replied Mr. Guivetchi. “The state has already invested well above $1.5 billion to encourage through an incentive program many of these entities to come together at a regional or sub-regional scale. In fact, we have close to 40 of these groups that have been doing good things. Yet, it’s really hard for them to sustain their activity, and that’s why one of the recommendations is that if only the state could just give them a little bit of ongoing support just to keep a lifeline of that collaborative together, it would be helpful.”

“Another approach is SGMA,” he continued. “SGMA, taking a regulatory approach, has now brought together these groundwater sustainability agencies in the state. Then on the flood side, we now have regional flood management groups. So the challenge and opportunity going forward is getting these various entities and collaboratives to begin working together, because it’s my opinion that the IRWM groups and the groundwater sustainability agencies, each has assets that the other needs to achieve their goals. And this I think, more than anything, should be an incentive to get them together, but I think that we’ve seen that through incentives and support, we can actually help move that forward, so I would say, let’s do more of the same of what we’ve been doing for the last 10-12 years.”

Commissioner Andrew Ball noted that on slide 6, it talks about the $2 billion a year that the state expends on water management. “The bottom comment there is ‘investment backlog is at least $350 billion over 50 years’, what does that represent? Backlog of what?”

“What we did is we surveyed flood and water agencies to see what is their need for refurbishing and improving their infrastructure, and adding all that together, the projects that they’ve identified, we came up with $350 billion that would be needed to actually do the projects that they have actually said they need to implement,” said Mr. Guivetchi. “There’s a list. One of the supporting documents does show how that information was arrived at.”

Commissioner Ball noted that’s a substantial amount of money, and we’re getting further behind every year. “On slide 12, on the vertical bar graph that goes out to 2068, you talk about a $90.2 billion state water investment plan. What does that represent and is there a path of funding that?”

“One of the supporting documents will lay out those 19 or 20 recommended actions that are laid out in the plan and how we estimated their cost over the next 50 years, and that, totaled together or tallied together, came up with the $90.2 billion over 90 years,” said Mr. Guivetchi. “As far as where the revenues would come from, in Chapter 4, we presented the results of an analysis with three different funding scenarios, a mix of general obligation bonds and general fund, just to give policymakers a sense for, if we did more with general fund, what would that mean? If we did more with GO bonds or if we did more an aggressive mix of the two. We do not recommend a specific funding source, but we did think that the scenarios would help policymakers to decide, if they decide to implement the actions in the water plan, over the next number of years, this is how much it would cost and where the funding could come from.”

“So even though we have an apparent $350 billion backlog, the Water Plan recommends less than 1/3rd of that amount as the path forward?” asks Commissioner Ball.

“Yes, with the caveat that our observation has been for the integrated regional water management planning grant program, for every $1 the state put out there, the locals came up with $4 to $5 of their own matching funds, so if the state were to include $78 billion as part of this $90 to incentivize local projects, we anticipate that the locals will also match that with four times the amount, which would move us in the direction,” said Mr. Guivetchi. “The $350 billion is not just what the state would pay, but what the entire … “

“But the projects … I assume there is an overlap there, and one is not exclusive of the other … ?” asked Commissioner Ball.

“I want to be clear that this is a strategic plan, so it’s not like we have every project listed out,” Mr. Guivetchi said. “In fact, if we did, that would trigger CEQA, so this is intended to be a strategy and an approach. So just like when you did the WSIP, you didn’t know the exact projects from the get go, but you laid out a program that incentivized people to send in proposals and we anticipate this would be in a similar fashion.”

“Bottom line, we have a lot to do and not enough money to do it,” said Commissioner Ball.

“We do, but I’m optimistic,” said Mr. Guivetchi. “I think we have done some good foundation work over the last decade that we can build on, we just now have say, let’s double down and do more integrated water management and bring the funding to bear to address this aging infrastructure and the ecosystem restoration.”

“What I like best about this is that it’s proactive as opposed to the past historical approach being reactive,” said Commissioner Ball. “You pay way more money when you react than you do when you’re proactive, so thank you for this.”

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